CEVA remains in the red despite airfreight demand growth

Freight forwarder CEVA remained in the red during the third quarter of the year despite increases in revenues and airfreight volumes.

The forwarder, which has been subject to takeover rumours this year, saw third-quarter revenues increase by 6.1% year on year to reach $1.8bn and adjusted earnings before interest, tax, depreciation and amortisation (ebitda) for the period was up 13.3% on last year at $85m.

However, CEVA registered a net loss for the period of $22m, although this was an improvement on the $41m loss last year.

“The main drivers of the difference [in losses] are the improvement in operating income and the positive impact of unrealized foreign exchange gain,” CEVA said.

Over the first nine months of the year, losses add up to $124m compared with $72m in 2016.

Looking at its airfreight business, the forwarder saw third-quarter volumes increase by 11.8% against market growth of around 10%.

The company said that market volatility in airfreight rates continues, particularly on routes from Asia.

It had mitigated that pressure “to a large extent” through volume planning and pricing measures.

In a press releases, management concentrated on the positives.

“I am pleased to announce another good quarter for CEVA" said Xavier Urbain, chief executive of CEVA.

“We have been able to offset ongoing market volatility in air and ocean freight. Our procurement and pricing strategy has enabled us to protect yields sequentially.

“Contract logistics continues to grow and delivers improved results through focused action on contracts. CEVA is on track to deliver a stronger result in 2017.

“The transformation we have embarked on is positioning CEVA as a strong player for the future."

The private equity owned company has been subject to takeover rumours over the last few years, with France’s Geodis expected to make an offer earlier this year. However, the deal failed to materialise and now looks to be dead.